CMS Rule banning arbitration clauses is blocked for now

A few months ago we wrote about a new rule issued by the Center for Medicare and Medicaid Services (CMS) that banned pre-litigation mandatory arbitration clauses in the admission contracts of nursing homes that receive federal Medicaid or Medicare dollars. A group of five organizations filed suit in federal district court in Mississippi, asking that the regulation be invalidated on the basis that the Agency had exceeded its statutory authority and arguing that the public policy rationale cited for the law was insufficient in light of the federal Arbitration Act. In a decision issued November 7th, the Federal District Court of the Northern District of Mississippi determined that the plaintiffs made a strong showing that they were likely to prevail after trial, and issued a preliminary injunction that prevents the agency from enforcing the regulation pending the outcome of the lawsuit. You can read the decision here. The case is called American Health Care Assn et al v Burwell et al.

 

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